Why Hire Dedicated Developers vs. a Dev Shop?

Industries ranging from healthcare and finance to marketing and education need software solutions. Fortunately, with a global developer population reaching approximately 28.7 million people in 2024, there are more and more ways to hire tech talent. And you’re no longer limited to local developers, either. Countries spanning the globe—from Latin America to Europe to Asia—offer an abundance of talent.

But with so many options, how do you decide where to find the right engineers at an affordable price? Two options are your best bet: hire dedicated developers or use the services of a dev shop.

If you’re unfamiliar with the nuances of these models, you’ve come to the right place. Here, we’ll examine the differences between dedicated developers vs. dev shops and explore the pros and cons of each.

Dedicated Developers: Key Characteristics

Dedicated developers are software engineers hired to work exclusively for you for an extended period. They typically come in two flavors:

• Employees hired full-time as employees of your company
• Fixed-term contractors who work for you for an extended period 

Full-time employees are the longer-term, more permanent option. They receive full-time salaries and benefits. Contract developers are the more flexible option.

You can hire dedicated developers in the US or abroad. Today, many businesses hire abroad due to the plethora of talent in regions like Latin America, Europe, and Asia. This is also a way of keeping costs low while still tapping into strong skill sets and experience.

Dedicated developers typically have several key characteristics:

• Long-Term Commitment: Dedicated developers typically work exclusively for you for an extended duration.
• Integration with Team: They become part of your internal team, working closely with your company’s employees, understanding your processes, and collaborating directly with your project stakeholders. There is usually a stronger cultural fit, too.
• Ownership: They tend to have a deep understanding of your goals, requirements, and intricacies due to their long-term commitment, which can lead to a sense of ownership. Even if you use an employer of record (EOR), you still have direct control over your team.
• Customization: Dedicated developers can be tailored to your specific project needs, skill requirements, and technology stack.
• Communication: Communication is generally more direct and seamless because dedicated developers are an integral part of your team.

Note: For product teams, you often hear the phrase “missionary vs. mercenary”, meaning finding people dedicated to your cause vs. just there for a paycheck. Dedicated developers are more missionary, committed to the company and its outcomes.

Dev Shops and Agencies: Key Characteristics

Dev shops or agencies are outsourcing companies. They may provide individual developers, typically through staff augmentation or similar approaches, or full teams. This is usually a project-based and shorter-term approach. Many developers hired through dev shops also offer specialized skills.

Some key characteristics of dev shops or agencies include:

• Team-Based Approach: Agencies provide a team of professionals with diverse skills to work on different aspects of a project, such as development, design, testing, and project management.
• Project-Based Engagement: Dev shops or agencies are often engaged on a per-project basis. They work on a specific project for a defined period, and once the project is completed, the engagement may end or continue with another project.
• Expertise: Agencies typically have experience working on a variety of projects and may bring best practices and industry insights to the table. They often specialize in certain tech stacks.
• Scalability: They can quickly adapt to changing project requirements by adjusting the team size or bringing in additional resources as needed.
• Less Integration: While collaboration is essential, the level of integration with your internal team might not be as deep as with dedicated developers. They may not fit in as well. Typically, they aren’t solely dedicated to your business and needs.
• Communication: Communication might involve an intermediary layer between your company and the agency’s team, which could potentially introduce some communication challenges. You will rarely be able to interview developers directly, which can mean a weaker fit and weaker communication.

Key Differences Between Dedicated Developers and Dev Shops

So, what are the main differences between dedicated developers and dev shops? 

1. Commitment: Dedicated developers offer long-term commitment, while dev shops or agencies are usually engaged on a per-project basis.
2. Integration: Dedicated developers become part of your internal team, while agencies work as an external team.
3. Ownership: Dedicated developers often develop a strong sense of ownership over the project due to their long-term involvement, hence the “missionary” designation.
4. Customization: Dedicated developers can be customized to your specific needs, while agencies provide a pre-built team with a range of skills.
5. Communication: Communication with dedicated developers is usually more direct, while agencies might involve an intermediary layer.
6. Project Variety: Agencies often handle various projects for different clients, bringing diverse experience, whereas dedicated developers focus solely on your company.

Both approaches have their merits, and the choice between dedicated developers and a dev shop depends on factors such as project scope, timeline, budget, desired level of collaboration, and the specific needs of your business.

Conclusion: Choosing Between Dedicated Developers and a Dev Shop

What’s the best choice for your business: dedicated developers or a dev shop?

To make an informed decision, consider factors like complexity, skills required, budget, timeline, and projects in the pipeline.

For developing products, where companies are developing new technology products and experiences,  the choice is clear: dedicated developers are the way to go. Especially for startups, dedicated developers give you the best chance to not just build your product, but also observe how customers react and then iterate to new versions of the product.

Dedicated developers also have the ability to be hired flexibly, either as full-time employees or as fixed-term contractors. As full-time employees, they’d be committed to your mission and could receive salary, benefits, and equity (even if employed internationally!).

For projects that have a finite end or timeline, a dev shop can be a good choice. Project examples that are a good fit for a dev shop are marketing websites, API integrations, or standing up a CMS.

How to Hire Dedicated Developers

Looking for dedicated developers to bring their expertise to your business? Talent marketplaces like Terminal can help. 

Here at Terminal, we help you find dedicated developers—either full-time employees or contractors—for your team. Interested in learning more? Talk to us today or start browsing our talent for free!

FAQ

What’s the difference between dedicated developers and dev shops?

The main difference between dedicated developers and dev shops is that dedicated developers work for your business as full-timers or contractors for an extended period of time, while dev shops provide developers who work on specific projects temporarily.

Why should I hire dedicated developers?

Hiring dedicated developers offers your business numerous advantages, including specialized skills, integration with your current team, and full focus on your company and projects.

When should I hire a dedicated development team?

You should hire a dedicated development team for long-term projects and niche skill sets. A dedicated development team is also helpful if your business is a startup or SME that’s scaling rapidly, your requirements are changing, and/or you need to curb costs. Additionally, a team allows you to reach market quickly and helps you manage the workload if your current or in-house team is overextended and you need to focus on your core responsibilities.

How do I find a dedicated developer?

At Terminal, we help you find top dedicated developers from Latin America, Europe, and Canada. We carefully vet all candidates and match them to your business based on skills and fit. 

Can I hire dedicated developers abroad?

Yes, you can absolutely hire dedicated developers abroad! Many businesses source top tech talent from regions around the world, tapping into hard-to-find skill sets and lowering costs.